I am a SHL shareholder. Do you think the share bonus plan is worth taking up?
I am a long term perspective, so am prepared to hold approximately 5 years.
A: On the basis that the share purchase plan is at $19.50 per share, and on market, the shares are trading at $21.95 per share, it would seem like a “no brainer” to take up. It will probably be subject to a scale back.
I am a little more cautious about the acquisition of Aurora Diagnostics (this is the reason for the share purchase plan and institutional placement). While the market has given it the thumbs up, the history of Australian companies achieving immediate benefits from US acquisitions is pretty poor.
This all said, the brokers see the stock as somewhat undervalued (consensus target price is 18.5% higher at $26.02). I would be somewhat surprised if there is much short term upside.